Oil & Gas

IOCs contemplating leaving Nigeria’s onshore operations over litigations — Sylva

The Minister of State for Petroleum, Chief Timipre Sylva, has revealed that many Independent Oil Companies (IOC’s) were contemplating leaving their onshore operations in the country, as a result of too many court cases.

Sylva, who made the disclosure on Tuesday in Abuja at the 2021 National Oil and Gas workshop for Justices and Judges with the theme, ‘Petroleum Industry Act New Legal and Fiscal Regime in the Nigerian Oil and Gas Industry’, said litigation was one of the major challenges impeding the growth of the nation’s oil and gas industry.

He said: “We must start from the judiciary because I can tell you this is one of the weakest links in the oil and gas industry. When I first came in as Minister of State, someone told me he had over 200 cases in court. He wanted us to support him to win the cases.

“What I realised was that the industry was taking oil companies to court and unfortunately, it has impeded the growth of the industry. Today I can tell you that a lot of oil companies are contemplating leaving the onshore of Nigeria. One of the biggest problems we have onshore in Nigeria is incessant court cases that reverberate across the industry,” he said.

While noting that implementation of the PIA would provoke more court cases especially by “disputants” whose opinions differ on how the law should be operationalised, he stressed the need for the Justices and Judges to acquaint themselves on areas likely to be the most contentious, to enable them apply the law to have the desired multiplier effect on the economy, investments, infrastructure, employment, the environment and well-being of the citizenry.

Sylva, who noted that the Nigerian petroleum industry was facing more critical challenges besides the COVID-19 pandemic, said the adoption of climate change policies by countries would affect fossil fuel financing and equally reduce government’s revenue.

“Several nations have announced the intent to comply with the Paris Agreement 2016 and have adopted climate change policies with a target of being carbon neutral by 2050 or 2060.

“This means that the usefulness of fossil fuels will diminish significantly, and even where they are still utilised, must be offset with some form of carbon capture technology. The EU, UK, South Korea, Japan, China, Brazil, and some other nations fall within this category,” he said.

New Telegraph

 

 

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